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Republican Counter-Offer to Raising Oil Spill Liability Cap – Let BP’s Accountants Figure It Out!

Sensing an opportunity after Lisa Murkowski stood up for poor oppressed oil executives and blocked consideration of a rise in the liability cap for companies implicated in oil spills, Democrats plan to bring up the Menendez-Nelson-Lautenberg “Oil Company Bailout Prevention Act” again and again next week, daring Republicans to continue to block it. So in response, Republicans have put together their own bill, raising the liability cap to a floating, easily gamed number.

A day after Alaska Republican Lisa Murkowski shot down a Democratic-led effort to lift the liability cap on oil companies, Florida Sen. George LeMieux and three other Gulf Coast Republicans introduced legislation they say would “dramatically increase” the industry’s liability.

The legislation — which also has the backing of Sens. David Vitter, R-La., Jeff Sessions, R-Ala. and Roger Wicker, R-Miss., would set a new cap equal to the last four quarters of the responsible party’s profits — or double the current limit, whichever is greater.

“BP is already responsible for the costs of the cleanup, but we must ensure taxpayers are not forced to pay for associated damages,” LeMieux said. He said economic damage from the spill will “far exceed” the current $75 million cap, and that under the bill, BP’s liability would jump to $17 billion dollars.

Obviously, the question becomes “what year is applicable to the cap,” and if it’s in the same year as this spill for BP, for example, that cap suddenly shrinks. If the company loses money in a calendar year, do they become not responsible at all (for a startup company with capital expenditures, that’s entirely possible)? Plus we’re putting the calculations in the hands of the accountants for the responsible party. Does that seem viable to you?

I hope the Republicans try to put this bill on the floor, so everyone can see exactly what side they’re on. Plus they can keep repeating the fact that BP made $17 billion dollars last year and yet gets politicians to do their bidding and stop them from paying their fair share.

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David Dayen

David Dayen